Amar Dutt, J.
1. This judgment will dispose of C.W.P. Nos. 9395, 11155, 11774, 12032, 12123, 12157, 12451, 12508, 12558, 12571,12572, 12590, 12654, 12661, 12699, 12739, 12771, 12773, 12824, 12943, 12947, 13156, 13218, 13744, 13926, 13996, 14014, 14033, 14220, 14701, 14730, 14779, 14797, 15016, 15104, 15125, 15337, 15338, 15507, 15532 and 15563 of 2004, as common questions of law arid fact arise in these writ petitions to challenge the view which is being taken by the Registrar, Debts Recovery Tribunal (hereinafter referred to as 'the Tribunal') on objection applications filed by them by which the petitioners have been required to affix court fee on their applications as per the provisions of Rule 7 of the Debts Recovery Tribunal (Procedure) Rules, 1993 (hereinafter referred to as 'the 1993 Rules').
2. The facts necessary for the decision of the points of law have been taken from C.W.P. No. 9395 of 2004. The necessity of filing these petitions arose when after the decision in Mardia Chemicals Ltd. and Ors. v. Union of India and Ors., (2004-3)138 P.L.R. 271 (S.C.) : (2004)4 S.C.C. 311, the 'secured creditor' as defined under Section 2(zd) of the Securitisation and Reconstruction of Financial Assets ,and Enforcement of Security Interest Act, 2002 (hereinafter referred to as 'the 2002 Act') started issuing notices under sub section (2) of Section 13 of the 2002 Act calling upon the borrowers to discharge their liability and intimating them that in the event of their failure to do so, the secured creditors may take recourse to one or more of the measures detailed in sub section (4) of Section 13 of the 2002 Act for recovery of the debts and upon their failure to meet the demand initiate the steps enumerated in sub-section (4) of Section 13 of the 2002 Act for enforcing their rights and recovering the amounts outstanding. After the receipt of these notices some of the petitioners had availed of the statutory remedy provided in Section 17(1) of the 2002 Act and filed appeals. The Registrar of the Tribunal has asked the petitioners to affix a court fee of Rs. 21,000/- before the appeal could be entertained. The grouse of the petitioners as spelt out in the pleadings inter alia are:-
a) that in view of the decision of the Supreme Court in Mardia Chemicals' case (supra) in which their Lordships of the Supreme Court have struck down as unconstitutional the provisions of Section 17(2) of the 2002 Act, which required the appellant to deposit 75 per cent of the amount that he had been called upon to pay by the secured creditors, no court fee could be demanded by the Tribunal as a condition precedent for entertaining the appeal as the aforesaid provision too would have to meet the same fate for the reasons indicated in the judgment.
b) That Anncxure P-3, the notification, which has been issued during the pendency of the Special Leave Petition, cannot stand judicial scrutiny in view of the fact that:
(i) the same is an attempt on the part of the State to circumvent the legal position as had been clarified by the Supreme Court; and
(ii) their being no provision under the 2002 Act unlike Section 36(c) and (d) of the Recovery of Debt Due to Banks and Financial Institutions Act, 1993 (hereinafter referred to as 'the 1993 Act), which authorises the appropriate government to make rules regarding affixation of court fee on an application moved under Section 17(1) of the 2002 Act.
In view of this, according to the petitioners, the interpretation, which is being put by the Registrar of the Tribunal cannot withstand judicial scrutiny and has to be set aside.
Apart from this, it has been submitted on behalf of the petitioners that the court fee that is required to be paid on an application under Section 17(1) of the 2002 Act is oppressive and has no nexus for the expenses that are being incurred to maintain the services that are being rendered by the Tribunal for adjudication of the applications under the Act and, therefore, the same cannot be sustained and has to be struck down.
3. In the reply filed by the Union of India it has been asserted that the order requiring the petitioners to pay court fee draws its sanction from the notification No. S.O. 466 (E) dated 6th April, 2004 (Annexure P-3), which relies upon the powers conferred under Section 17(3) and 40 of the 2002 Act for extension of the provisions of the 1993 Rules, which have been framed under Section 36 of the 1993 Act for requiring the parties to affix the court fee for seeking adjudication of applications/appeals under various Sections of the 1993 Act and 2002 Act. With regard to the second objection, it was submitted that no material need be brought on the record to co-relate the expenditure incurred by the State lo maintain the Tribunals and its supporting staff and the other facilities required by the Tribunal for providing speedy justice and the fee prescribed and the rates at which the court fee is chargeable on applications/appeals under the 1993 and 2002 Acts is on the same pattern as leviable under the Court Fees Act for any adjudication sought for before a Civil Court and, therefore, it calls for no interference.
4. We have heard the learned counsel for the parties and have perused the records.
5. The facts necessitating the filing of these writ petitions in this Court are not in dispute. Various borrowers as defined in Section 2(f) of the 2002 Act had after the promulgation of the 2002 Act filed a number of writ petitions challenging the vires of the provisions of the Act, which were enacted in order to facilitate speedy recovery of the debts taken by these petitioners when the procedure prescribed under the 1993 Act was not found to be adequate. The petitions were kept pending to await the decision of the Apex Court which was seized of the controversy, which was finally decided by the Apex Court in Mardia Chemical's case (supra). For the purpose of their submissions, the petitioners rely on the following observations of their Lordships in relation to the vires of Section 17(2) of the 2002 Act:-
'64. The condition of pre-deposit in the present case is bad rendering the remedy illusory on the grounds that; (i) it is imposed while approaching the adjudicating authority of the first instance, not in appeal, (ii) there is no determination of the amount due as yet, (iii) the secured assets or their management with transferable interest is already taken over and under control of the secured creditor, (iv) no special reason for double security in respect of an amount yet to be determined and settled, (v) 75% of the amount claimed by no means would be a meager amount, and (vi) it will leave the borrower in a position where it would not be possible for him to raise any funds to make deposit of 75% of the undetermined demand. Such conditions are not alone onerous and oppressive but also unreasonable and arbitrary. Therefore, in our view, sub-section (2) of Section 17 of the Act is unreasonable, arbitrary and violative of Article 14 of the Constitution.'
Following the decision in Mardia Chemical's case (supra), this Court had disposed of a number of petitions and directed the parties to seek their remedy by filing appeal before the Tribunal having jurisdiction in the matter within forty five days from the date on which such measures had been taken. The petitioners, it seems had initially accepted the verdict and had filed appeals against notices served upon them under Section 13(4) of the 2002 Act by the various secured creditors. Some of them had affixed a court fee of Rs. 250/- on the appeals and it is the objection of the Registrar of the Tribunal, which required the petitioners to affix a court fee of Rs. 21,000/- in the case of M/s. Atma Jain Hosiery Emporium and another, which has necessitated this second round of litigation. The purpose of the challenge has already been spelled out by the us hereinabove and for appreciating the rival contentions, it would be appropriate to refer to the relevant provisions of the 2002 Act.
6. Section 13(2X3) and (4) of the 2002 Act, which incorporates the procedure to be followed by a secured creditors for enforcing the security interest created in his favour without intervention of the Court, reads as under:
'13. Enforcement of security interest:
(1) xxx xxx xxx xxx xxx xxx
(2) Where any borrower, who is under a liability to a secured creditor under a security agreement, makes any default in repayment of secured debt or any instalment thereof, and his account in respect of such debt is classified by the secured creditor as non-performing assets, then, the secured creditor may require the borrower by notice in writing to discharge in full his liabilities to the secured creditor within sixty days from the date of notice failing which the secured creditor shall be entitled to exercise all or any of the rights under sub-section (4).
(3) The notice referred to in sub-section (2) shall give details of the amount payable by the borrower and the secured assets intended to be enforced by the secured creditor in the event of non-payment of secured debts by the borrower. ;
(4) In case the borrower fails to discharge his liability in full within the period specified in sub-section (2), the secured creditor may take recourse to one more of the following measure to recover his secured debt, namely:-
a) take possession of the secured assets of the borrower including the right to transfer by way of lease, assignment or sale for realising the secured asset;
b) take over the management of the secured assets of the borrower including the right to transfer by; way of lease, assignment or sale and realise the secured assets;,
c) appoint any person (hereinafter referred to as the manager), to manage the secured assets the possession of which has been taken by the secured creditor;
d) require at any time by notice in writing, any person who has acquired any of the secured assets from the borrower and from whom any money is due or may become due to the borrower, to pay the secured creditor, so much of the money as is sufficient to pay the secured debt.
(5) to (13) xxx xxx xxxx xxx
This Section envisages two stages through which the claim of the secured creditors has to pass;-
a) a notice under sub-section (2); and
b) in case the creditor fails to discharge the liability within the period specified under sub-section (2), to take recourse to the measure specified in sub-section (4) for recovery of the secured debts.
The service of a notice under sub-section (2) of the Section 13 of the 2002 Act leaves the 'borrower' as defined under sub-section (f) of Section 2 of the 2002, which reads as under:-
'2(f) 'borrower' means any person who has been granted financial assistance by any bank or financial institution or who has given any guarantee or created any mortgage or pledge as security for the financial assistance granted by any bank or financial institution and includes a person who becomes borrower of a securitisation company or reconstruction company consequent upon acquisition by it of any rights or interest of any bank or financial institution in relation to such financial assistance.' with two options;-
a) to approach the secured creditors and negotiate for clearance of his liability; and
b) to raise dispute within 45 days of the enforcement of any measure indicated in sub-section (4) of Section 13 of the 2002 Act by the secured creditor by filing an appeal under sub-section (1) of Section 17 of the 2002 Act before the Tribunal having jurisdiction in the matter. Section 17(2) of the 2002 Act, which has been struck down by the Apex Court provided that the appeal would not be entertained unless 75 per cent of the amount claimed in the notice under sub-section (2) of Section 13 is deposited with the Tribunal. Section 18 of the 2002 Act, which reads as under; -
'18. Appeal to Appellate Tribunal;- (1) Any person aggrieved, by any order made by the Debts Recovery Tribunal under Section 17, may prefer an appeal to an Appellate Tribunal within thirty days from the date of receipt of the order of Debts Recovery Tribunal.
2) Save as otherwise provided in this Act, the Appellate Tribunal shall, as far as may be , dispose of the appeal in accordance with the provisions of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993(51 of 1993) and rules made thereunder.'
enables a person aggrieved by any order passed by the Tribunal to prefer appeal under Section 17 of the 2002 Act.
7. As already indicated, the petitioners feel that in view of the observations as contained in para No. 64 of Mardia Chemical's case (supra),this Court should hold that the notification, Annexure P-3, which extends the provisions of Rule 7 of the 1993 Rules to the proceedings under the 2002 Act, for similar reasons, is liable to be struck down. The argument though attractive at first sight, does not stand up to closer scrutiny as for accepting the same, this Court would have to hold that the court fee payable under Rule 7 of the 1993 Rules, which was required to be deposited under sub section (2) of Section 17 of the 2002 Act, is akin to the deposit that the borrower was required to make under Section 17(2) of the 2002 Act. The fallacy in the argument is not difficult to gauge. In Corpus Juris Secundum, Volume XXVI, Page 772 the word 'deposit' when used as a noun has been described as under:-
'In the Sense of an Act. A deposit has been described as a mere incident of custody, and, in its ordinary signification, implies something more than mere possession, negatives all idea of loan with contemplation of use for profit, and has been defined as an act by which a person receives the property of another, binding himself to preserve it and return it in kind, the act of one person giving to another, with his consent, the possession of personal property to keep for the use and benefit of the first or of a third party. It may mean a permanent disposition of the thing placed or deposited, or a mere temporary disposition or placing of the thing. In a particular connection and context, has been said that the word means more than a delivery for mere inspection; it means the delivery of a book or paper to one entitled to have the official custody thereof, either to be kept or to be re-delivered, after it has served its purpose, to one having a right to receive it. In a more technical legal sense, the term has been defined as a naked bailment of goods to be kept for the depositor without reward and to be returned when he shall require it.'
8. From a perusal of the above, it is clear that the ownership of the security so deposited does not change. It remains with the depositor and can only be appropriated for payment to the secured creditors after a due adjudication by a Court of law and has to be adjusted towards debt, which borrower may be liable to pay. On the other hand, it is well known that court fee is a levy, which the State charges to enable it to maintain the adjudicatory facilities, which it provides for decision of disputes that are brought before a Court of law. Reference in this regard may be made to law laid down by the Privy Council in Rachappa Subrao Jadhav Desai v. Shidappa Venkant Rao Jadhav Desai. AIR 1918 PC 188, wherein if was held as under:-
'The Court-Fees Act was passed not to arm a litigant with a weapon of technicality against the opponent but to secure revenue for the benefit of the State.' and by a Division Bench of the Calcutta High Court in Tara Chanel Ghanshvam Das v. State of West Bengal, AIR 1955 Calcutta 258, wherein it has been held as under:-
'Court fees are the price levied by the State from persons litigating before it for the services rendered to them in connection with their causes. They are fees by which the State reimburses itself for the costs incurred by it in maintaining a judicial system. Such fees are levied under the sanction of statute in which the legislature has laid down on what documents or transactions a fee shall be levied by the State and what its rates shall be. Thus, the legislature, being minded to provide the State with finances to maintain the judicial system, has authorised the levy of a revenue in the shape of what may be called a judicial tax and has specified both the chargeable items and the quantum of the levy. In doing so, it has chosen such items as it has considered proper and fixed such rates as it has considered reasonable, presumably with the quantum of the funds required by the State present to its mind.
Whether or not the State should in effect sell justice is a question of policy with which the Court is not concerned. All that the Court need and can take into consideration as that revenue in the shape of court fees has been provided for and secured by the statutes. The Legislature seems to have applied its mind to the question whether the fee levied in the first instance should be retained in all cases and has specifically indicated the occasions on which the fee should be refunded. That being so, it cannot possibly be within the jurisdiction of a Court of law to modify or add to the provisions of the taxing statute and interfere indirectly with the revenues of the State by purporting to make what it considers to be equitable adjustments of the court fee in exercise of its inherent power. To do so would be to interfere with the revenues of the State in the face of the statute.'
9. There is no provision in the Rules providing for any eventuality in which the court fee paid is to be returned. The argument, therefore, in our opinion, has no legs stand and has to be rejected.
10. The adverse decision of the first argument, however, would not absolve us of the obligation to deal with and dispose of the other two objections on which the petitioners seek to assail the extension of Rule 7 of the 1993 Rules to appeals under Section 17(1) of the 2002 Act. It is the common case of the parties that with the aid of Annexure P-3, the respondent sought to extend the provisions of Rule 7 of the 1993 Rules to appeals under Section 17(1) of the 2002 Act. This notification is assailed primarily on the ground that there is, in the 2002 Act, no provision analogous to Section 36(c) and (d) of the 1993 Act, which would enable the appropriate government to make rules for prescribing the court fee that has to be affixed on applications/appeals etc. under the 1993 Act. This argument too cannot be sustained because the perusal of Section 17(3) of the 2002 Act, which reads as under.
'17. Right to appeal:-
(3) Save as otherwise provided in this Act, the Debts Recovery Tribunal shall, as far as may be dispose of the appeal in accordance with the provisions of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 (51 of 1993) and rules made thereunder'
makes it clear that the Legislature had in its wisdom extended the provisions of the 1993 Act and the Rules made thereunder in so far as it relates to entertainment and disposal of the appeal to the proceedings under the 2002 Act also. The fact that Section 18(2) of the 2002 Act is enacted in the same terms further supports our conclusion that the provisions of the 1993 Act and the Rules made thereunder were extended by legislative intent separately in these two provisions to appeal filed under Section 17 and 18 of the 2002 Act. In this view of the matter, while there is no doubt that the appropriate government has, through notification Annexure P-3 merely reiterated this intention, a perusal of the notification makes it clear that the same merely highlights the various provisions of the 2002 Act and states that the provisions of Rule 7 of the 1993 Rules would be applicable to proceedings under the said Act.While doing so, the notification banks upon the provisions of sub-section (3) of Section 17 of the 2002 Act and highlights it as the source of the power. The aforesaid Section had, in our opinion, as already indicated, the application of various provisions of the 1993 Act and the Rules made thereunder to proceedings under the 2002 Act by using the words 'as far as possible'. The notification has in fact only replaced these words by Mutatis Mutandis, which in Latin.means the same thing as is evident from the interpretation put in by the Apex Court in A/A Ashok Service Centre and Anr. etc. v. State ofOrissa, AIR 1983 Supreme Court 394, which reads as under: -
'Before considering what provisions of the Principal Act should be read as part of the Act, we have to understand the meaning of the expression 'mutatis mutandis'. Enrl Jowitt's 'The Dictionary of English Law (1959)' defines 'mutatis mutandis' as (with the necessary changes in points of detail'. Black's Law Dictionary (Revised 4th Edn. 1968) defines 'mutatis mutandis' as 'with the necessary changes in points of detail, meaning that matters or things are generally the same, but to be altered when necessary as to names, offices, and the like, Housman v. Waterhouse, 191 App. Div 850, 182 NYS 249, 251'. In Bouvier's Law Dictionary ( 3rd Revision, Vol.11), the expression 'mutatis mutandis1 is defined as ' the necessary changes. This is a phrase of frequent practical occurrence, meaning that matters or things are generally the same, but to be altered when necessary, as to names, offices, and the like'. Extension of an earlier Act mutatis mutandis to a later Act brings in the idea of adaptation, but so iar only as it is necessary for the purpose, making a change without altering the essential nature of the thing changed, subject of course to express provisions made in the latter Act.'
Even from what has been stated hereinbefore, we are of the firm view that by no stretch of imagination can it be held that notification Annexure P-3 has been issued only to circumvent the decision in Manila Chemical's case (supra) and while doing so we may even at the cost of repetition point: out that wrnu has been struck down in para 64 of the judgment, is the clause regarding deposit of 75 per cent of the amount claimed and not the court fee which was chargeable even at She time their Lordships were seized of the matter.
11. We may now proceed to examine vise validity of the arguments that the court fee jta.yabie should be struck down as oppressive. In this regard, it would be suffice to say that the court fee payable under Rule 7 of the 1993 Kales is in no way more than what has been prescribed under the Court. Fees Act and in any way is charged more than what has been prescribed under She Act, It has also to he home in mind that application muter Section 17 of the '2002.Act is being treated as an appeal i'nd the court fee payable tor tnaintaining the appeal under Section 17(i) and 18(1) of the 2002 Act would be payable as per Sr No. 5 of table of Sub Rule Rule (2) of Rule- 7 of the 1993 Rules at the following rate:-
'5. Appeals against orders of the Recovery Officer
If the amount appealed against isi) loss than Rs. 10 lakhs Rs. 12,000/-ii) Rs. 10 lakhs or more but less Rs. 20,000/-than Rs. 30 lakhs.iii) Rs. 30 lakhs or more Rs. 30,000/-'
The reason is obvious. The notice under Section 13(4) of the 2002 Act in the absence of any challenge by the borrowers attains finality and Section 17(1) of the 2002 Act gives a right to any person aggrieved by this determination including the borrowers to have adjudication by the Tribunal regarding the correctness of the conclusions arrived at by the secured creditors. If there after even either the secured creditors or any one aggrieved by the notice is not satisfied by the adjudication, he is given another opportunity of assailing the conclusion by. filing an appeal under Section 18(1) of the 2002 Act. In this view of ours we are supported by the observations of the Apex Court in Mardia Chemical's case(supra) wherein it was held that the appeal as envisaged under Section 17 of the 2002 is more like a suit as it would be for the first time that an independent body is called upon to adjudicate upon the rights of the secured creditors and borrowers.
12. The manner in which sub-section (2) of Section 17 and Section 18 of the 2002 Act arc couched it is evident that the provisions of the 1993 Act and the Rules made thereunder would as far as possible be made applicable to the appeal under Sections 17 and 18 of the 2002 Act. Ordinarily, we would have said that the table at Sr No. 5 of sub-Rule (2) of Rule 7 of the 1993 Rules would be applicable to both the Sections as in view of the observations made by the Apex Court, the proceedings under Section 17 of the 2002 Act will have to be held more of a suit than an appeal in their very nature, we are of the considered view that for appeals under Section 17 of the 2002 Act, the provi- sions of Sr.No.l of table of Sub Rule (2) of Rule 7 of the 1993 Rules, which reads as under: -
'Application for recovery of debts due
Under Section 19(1) or Section 19(2) of the Act.a) Where amount of debt due is Rs. 10 lakhs Rs. 12,000/-b) where the amount of debt due is aboveRs. 10 lakhs; Rs. 12,000/-plusRs. 1000/- for every one lakh rupees ofdebt due or part thereof in excess ofRs. 10/- lakhs, subject to a maximumof Rs. 1,50,000/-'
would apply and or appeals under Section 18(1) of the 2002 Act, the provisions of Sr. No. 5 of table of sub Rule (2) of Rule 7 of 1993 Rules, as reproduced hereinbefore, would ap- ply for determining the Court fee payable in proceedings under these Sections.
13. Fmther more, no challenge to the provisions of Section 17(1) and 18(1) of the 2002 Act can be accepted on the ground that it gives an opportunity to the secured creditors to unduly harass the borrower for the mere reason that Section 19 of the 2002 Act provides an in built protection by making it obligatory on the Tribunal while dis- posing of such applications to award such costs and compensation as it may find the borrower entitled to on account of the proceedings, which he has had to suffer as a con- sequence of the proceedings initiated against him by the secured creditor under the pro- visions of the 2002 Act.
14. For the reasons recorded above, all these petitions fail and arc dismissed, leaving the parties to bear their own costs.